October 1, 2019
SEC Orders an Additional 16 Self-Reporting Advisory Firms to Pay Nearly $10 Million to Investors
On September 30, 2019, the SEC announced it settled charges against 17 investment advisers for disclosure failures regarding their mutual fund share class selection practices. The firms include 16 advisers that self-reported as part of the Division of Enforcement’s Share Class Selection Disclosure Initiative (Initiative) and one adviser that did…
September 23, 2019
Advisers Fined $5 Million for Disclosure and Compliance Violations Related to Securities Lending and Unreimbursed Tax Expenses for Mutual Fund Clients
On September 16, 2019, the SEC issued a settled order describing violations of the Investment Advisers Act of 1940 (“Advisers Act”) and rules thereunder by two registered advisers for undisclosed conflicts of interest and misleading disclosures relating to certain securities lending practices, and misleading disclosures and deficient policies and procedures…
September 5, 2019
SEC Continues to Pursue Share Class Selection Cases
Two separate complaints filed last month against Cetera Advisors, LLC (“Cetera”) and Commonwealth Financial Network (“Commonwealth”) show that the SEC is still pursuing intermediaries for conflicts of interest and related violations related to fund share class selection. The complaints against Cetera and…
August 30, 2019
SEC Provides Guidance on Proxy Voting By Registered Investment Advisers
On August 21, 2019, the Securities and Exchange Commission issued guidance (Guidance) on the proxy voting and disclosure responsibilities of registered investment advisers under the Investment Advisers Act of 1940, as amended. The Guidance discusses, among other matters, the ability of investment advisers to establish a variety of different voting…
July 23, 2019
SEC Staff Issues No-Action Letter Providing Relief for Multi-Manager Funds with Respect to Shareholder Approval Requirement for Affiliated Sub-Advisers
On July 9, 2019, the SEC staff granted no-action relief under Section 15(a) of the Investment Company Act of 1940 and certain disclosure requirements, which relief provides additional flexibility to multi-manager funds and investment advisers operating under an existing multi-manager exemptive order, without having to seek amendments to their current…
July 23, 2019
SEC Adopts Amendments to Auditor Independence Rules Regarding Loans
On June 18, 2019, the SEC adopted amendments to its auditor independence rules that change the analysis used to determine whether an auditor is independent when it has a lending relationship with certain shareholders of an audit client during an audit or professional engagement period. The amendments help to address…
July 23, 2019
ICI Submits Comment Letter to SEC Recommending Ways to Improve the Proxy Voting System
In connection with the Proxy Roundtable hosted by the SEC in November 2018, on June 11, 2019, the Investment Company Institute (ICI) submitted additional recommendations for improving the proxy system for funds and shareholders. In its comment letter, the ICI described aspects of the proxy process that have proved to…
June 11, 2019
SEC Adopts New Rules and Interpretations for Investment Advisers and Broker-Dealers
On June 5, 2019, the Securities and Exchange Commission (SEC) adopted a set of rulemakings and interpretations governing the duties investment advisers and broker-dealers have to their clients. The SEC adopted four items: Regulation Best Interest; a new Form CRS Relationship Summary; an interpretation under the Investment Advisers Act of…
June 11, 2019
SEC Approves Precidian’s Non-Transparent, Active ETFs
On May 20, 2019, the Securities and Exchange Commission (SEC) granted exemptive relief under the Investment Company Act of 1940 for Precidian Investments’ non-transparent actively managed exchange-traded funds (ETFs). The exemptive relief permits registered open-end investment companies that are actively managed ETFs to operate without being subject to the current…
May 30, 2019
SEC’s Division of Corporation Finance Provides Guidance to Broker-Dealers on Delivery of Mutual Fund Prospectuses to Clients of Discretionary Investment Advisers
On April 11, 2019, the Securities and Exchange Commission’s Division of Corporation Finance (Division) provided guidance to broker-dealers with respect to delivery of mutual fund prospectuses to clients of discretionary investment advisers. The Division stated that, for purposes of Section 5(b)(2) of the Securities Act of 1933, it is of…